India's Demonetization Disaster: Modi Likens Critics to Pakistan

Indian Prime Minister Narendra Modi has accused his critics of his demonetization decision of “brazenly standing in support of the corrupt and the dishonest” and equated their criticism with the “firing at the borders by Pakistan in a bid to provide cover to infiltrators”,  according to the Indian media reports.

Diverting Attention:

Modi's attempt to use Pakistan to divert his people's attention from India's internal problems is not new. In fact, it's part of a pattern that seems to work in India. But why is it? What makes so many Indians so gullible? To answer this question, let us look at the following quote from Indian writer Yoginder Sikand's book "Beyond the Border":

"When I was only four years old and we were living in Calcutta (in 1971) was clear that "Pakistan" was something that I was meant to hate and fear, though I had not the faintest idea where and what that dreaded monster (Pakistan) was. What I heard and read about the two countries (India and Pakistan)--at school, on television and over radio, in the newspapers and from relatives and friends--only served to reinforce negative images of Pakistan, a country inhabited by people I necessarily had dread and even to define myself against. Pakistan and Muslim were equated as one while India and the Hindus were treated as synonymous. The two countries, as well as the two communities were said to be absolutely irreconcilable. To be Indian necessarily meant, it seemed to be uncompromisingly anti-Pakistani. To question this assumption, to entertain any thought other than the standard line about Pakistan and its people, was tantamount to treason."

Having been brought up with the misguided notion that Pakistan is evil incarnate, it seems that a large plurality of Indians viscerally hate Pakistan, and also hate anything that is likened to their western neighbor.

Such tactics may serve the politicians well but they do not solve India's long-standing problems that have put Indians among the most deprived people with the world's largest population of poor, hungry and illiterates.

Modi's hasty demonetization decision is also indicative of the rash decision-making by India's Hindu Nationalist leader. It's dangerous for stability in South Asia.

Demonetization Debacle:

Mr. Modi's blunder in hasty demonetization of large Indian currency notes has brought untold suffering to the people of India. The instant removal of 85% of cash from circulation in a cash-based economy has been harshly criticized almost universally by experts around the world.

Morgan Stanley’s Ruchir Sharma has said it's Mr. Modi’s “clumsy exercise of state power” and it won’t achieve its ostensible aim—cracking down on so-called “black money” salted away by tax dodgers, according to Sadanad Dhume's op ed in Wall Street Journal.

Kaushik Basu, a former chief economic advisor to the government of India and former chief economist at the World Bank, has called it “poorly designed, with scant attention paid to the laws of the market.”

Forbes magazine's Steve Forbes has called Modi's demonetization decision "sickening and immoral". Wall Street Journal's editorial page has described it as "India's bizarre war on cash".

Here's an excerpt of how the Economist magazine describes the effects of Modi's "botched" demonetization decision on life and economy of the nation:

"Cash is used for 98% by volume of all consumer transactions in India. With factories idle, small shops struggling and a shortage of cash to pay farmers for their produce, the economy is stuttering. There are reports that sales of farm staples have fallen by half and those of consumer durables by 70%. Guesses at the effect on national output vary wildly, but the rupee withdrawal could shave two percentage points off annual GDP growth (running at 7.1% in the three months to September)".


Prime Minister Narendra Modi's hasty demonetization decision has exposed his rash decision-making style. It has already caused untold suffering for ordinary Indians. Mr. Modi's decision processes have also raised serious questions about the formulation of Hindu Nationalists' Pakistan policy.  Fears of miscalculation by Mr. Modi's inner circle about Pakistan's response to any major provocation could result in serious consequences for the entire region.

Related Links:

Haq's Musings

Hinduization of India Under Modi

Modi Fudging Indian GDP Figures

Is India Succeeding in Isolating Pakistan?

India's Covert War Against Pakistan

BJP Superpower Delusions and Policy Blunders

India Home to World's Largest Population of Poor, Hungry and Illiterates

MPI Reveals Depth of Deprivation in India


Riaz Haq said…
China and India GDP figures tell a story, just not a true one

Nikkei Asian Review

I was curious about how Prime Minister Narendra Modi's surprise move to withdraw 500- and 1,000-rupee bills could impact the Indian economy, so I read a Dec. 8 report on the Indian central bank's decision to keep interest rates unchanged.

In the report, a term that was unfamiliar to me -- gross value added -- piqued my interest. The article said the central bank had downwardly revised its GVA-based growth forecast for the year through March 2017 to 7.1% from 7.6%.

Doing some research, I found that a country's GVA is the total of the value of goods and services produced in all industries and similar to GDP in terms of being a measure of production. The Reserve Bank of India, the central bank, does not put much faith in GDP data and uses GVA instead to assess the country's economic health.

In early 2015, India switched its method of calculating GDP from a formula based on supply-side prices to one using demand-side prices. The result was a sharp increase in India's GDP growth rates. The growth figure for the July-September quarter in 2014, for instance, was upgraded to 8.2% from 5.3%.

Based on the new GDP calculation formula, India's economy grew by 7.6% in 2015, outpacing China's 6.9% expansion. The switch has helped India cultivate an image as the new star performer among emerging countries, replacing China.


But the RBI argues that the old formula for calculating GDP, which uses supply-side prices in computing the total value created through production, is more suitable for accurately evaluating the country's economic performance.


Which data is most useful for understanding how a country's economy is faring depends on the country's industrial structure, which evolves over time.

As for India, Yuji Kuronuma, who heads The Nikkei's bureau in New Delhi, says he mainly follows corporate lending, tax revenue and sales of Unilever's lifestyle products, but also keeps an eye on auto sales and airline passenger numbers.
Riaz Haq said…
#India tops the world slavery chart with 18.4 million #Indians (1.4% of population) held in #slavery . …

India tops the world slavery charts with 18.4 million slaves followed by China's 3.4 million and Pakistan's 2.1 million.

In terms of percentages, North Korea tops with 4.37% of population in slavery followed by Uzbekistan's 3.97% and India's 1.4%.

The number of modern slaves (45.8 million according to the 2016 Global Slavery Index) is 28 percent higher than the number that was reported in the 2014 edition. However, this difference is mainly caused by a different methodology and data compiling process applied during research. The 2016 index is based on 42,000 interviews in 25 nations
Cambodia is the country with the highest amount of modern slaves in the Southeast Asian region. According to the 2016 Global Slavery Index 1.6 percent of the Cambodian population is victim of slavery. However, in absolute terms, Indonesia leads the ranking in Southeast Asia
Combined, there are 26.6 million victims of slavery living in India, China, Pakistan, Bangladesh, and Uzbekistan. Together, these five countries account for 58 percent of total global slavery
The Walk Free Foundation is an Australia-based human rights group
Most modern slaves - nearly two-thirds - can be found in Asian countries. This is attributed to the huge number of people living in Asia, while this continent is also well integrated into the global supply chains
Riaz Haq said…
How #India broke its #economy (on purpose). #Modi #Demonetization #BJP …

The same night that Donald Trump stunned pundits and became America’s President-elect, Indian Prime Minister Narendra Modi dropped a bomb of his own: At midnight, his country’s 500- and 1,000-rupee notes would become “worthless little slips of paper.” He was taking those notes (worth about $7.37 and $14.74, respectively), amounting to 86% of India’s currency, out of circulation. Indians were given until Dec. 30 to swap their old bills for new ones.
Modi warned that the surprise demonetization might involve short-term pain, and it has: The new bills weren’t ready, nor were the nation’s few ATMs, which had to be reconfigured to distribute them. The economy all but ground to a halt as millions spent their days waiting in bank lines (dozens, according to reports, died doing so). The cash crunch has led others to resort to bartering, and Goldman Sachs has shaved 1.5% from its 2017 GDP forecast for India.

Many are skeptical the scheme will achieve its original aim—eradicating the untaxed “black money” that fuels corruption. But there’s another likely benefit: 90% of transactions in India involve cash, and the lack of it has boosted alternatives. Bitcoin and digital payment use have surged (fewer than 2% of Indians have credit cards). India may be on the way to a more efficient, cashless economy—it’s just going to be a bumpy ride.
Riaz Haq said…

#Demonetization pushed #India factory activity into contraction in Dec 16, biggest month-to-month decline since 2008

Indian factory activity plunged into contraction last month as a cash crunch following Prime Minister Narendra Modi's currency crackdown severely hurt output and demand, a survey found on Monday.

The Nikkei/Markit Manufacturing Purchasing Managers' Index fell to 49.6 in December from November's 52.3, its first reading below the 50 mark that separates growth from contraction since December 2015.

It was also the biggest month-on-month decline since November 2008, just after the collapse of Lehman Brothers triggered a financial crisis and brought on a global recession.

"Having held its ground in November following the unexpected withdrawal of 500 and 1,000 bank notes from circulation, India's manufacturing industry slid into contraction at the end of 2016," said Pollyanna De Lima, economist at survey compiler IHS Markit.

"Shortages of money in the economy steered output and new orders in the wrong direction, thereby interrupting a continuous sequence of growth that had been seen throughout 2016."

The output sub-index at 49.0 was its lowest this year, though the rate of contraction was only slight.

The new orders sub-index which measures both foreign and domestic demand was also knocked to its weakest in 2016.

Contractions in momentum were reported across all major sub-indexes in the survey, such as purchasing activity and employment, highlighting the blow to the economy after the government's demonetization drive.

Modi's decision to scrap high-value banknotes as part of a crackdown on tax dodgers and counterfeiters removed 86 percent of the currency in circulation virtually overnight, denting consumption in a country where the vast majority of people still rely on cash for day-to-day activities.

Economists have begun slashing GDP forecasts and some of the more pessimistic views are that growth will halve from the 7.3 percent year-over-year rate clocked in July-September, especially as consumer spending accounts for over half of India's output.

Riaz Haq said…
#India #demonetization: #FMCG sales down 1-1.5% in Nov. Hero #motorcycle down by a third. Credit growth at 30-yr low

MOST economists might hazard a guess that voiding the bulk of a country’s currency overnight would dent its immediate growth prospects. On November 8th India took this abstruse thought experiment into the real world, scrapping two banknotes which made up 86% of all rupees in circulation. Predictably, the economy appears indeed to have been hobbled by the sudden “demonetisation”. Evidence of the measure’s costs is mounting, while the benefits look ever more uncertain.

As data trickle through, so is evidence of the economic price paid for demonetisation. Consumers, companies and investors all wobbled in late 2016. Fast-moving consumer goods, usually a reliable growth sector, retrenched by 1-1.5% in November, according to Nielsen, a research group. Bigger-ticket items seem to have been hit harder. Year-on-year sales at Hero Motocorp, the biggest purveyor of two-wheelers, slid by more than a third in December.

A survey of purchasing managers in manufacturing plunged from relative optimism throughout 2016 to the expectation of mild contraction. Firms’ investment proposals fell from an average of 2.4trn rupees ($35bn) a quarter to just 1.25trn rupees in the one just ended, according to Centre for Monitoring Indian Economy, a data provider. As a result, corporate-credit growth, already anaemic, has reached its lowest rate in at least 30 years (see chart).

All this amounts to “a significant but not catastrophic” impact, says Shilan Shah of Capital Economics, a consultancy. Annual GDP growth forecasts for the fiscal year ending in March have slipped by around half a percentage point, to under 7%, from an actual rate of 7.3% in the last full quarter before demonetisation. Other factors, such as the rise in the oil price and the surge in the value of the dollar after the election of Donald Trump, are also at play.
Riaz Haq said…
Even #Trump Building Isn’t Immune to #India’s Real Estate Woes After #Modi's #Demonetization via @business

by Pooja Thakur Mahrotri
January 10, 2017, 1:00 PM PST January 11, 2017, 1:20 AM PST
Land prices may decline 25 percent, homes 20 percent: analysts
Cash component of home purchase often as much as 50 percent
After trying for four months to sell his apartment in a western suburb of Mumbai, Meher Verma decided to cut the price by 10 percent. With property demand plummeting in the wake of November’s sudden ban on high-denomination notes, he’s not sure the reduction will do the trick.

“I was hoping to sell my house soon,” said Verma, who put his two-bedroom property in Andheri on the market for $400,000 in September. “Now it looks like I might have to cut my price or wait much longer for the market to improve.”

Real estate has long been a place where Indians have parked cash, often using money on which taxes haven’t been paid. Now, with Prime Minister Narendra Modi’s crackdown on so-called black money and the underground economy, real estate is taking a hit. The rate of home sales has fallen by about half since the government acted in early November, according to an estimate from Khushru Jijina, managing director of Piramal Fund Management Pvt. in Mumbai, who cited discussions with developers. Home prices may decline 20 percent and land prices could plummet as much as 25 percent, according to analysts’ projections.

“Those who were looking to buy property as an investment vanished overnight from the market after the cash ban,” said Aubrey Carvallo, a Mumbai broker who has never seen demand in Mumbai so low in his two decades of working in the industry. He’s been unsuccessfully seeking buyers for eight apartments with prices starting at 15 million rupees ($220,000). “They are thinking of moving to stock markets and other financial assets, as real estate prices are set to correct in the coming years with the government crackdown on unaccounted money expected to continue."

India’s largest developers, including DLF Ltd. and Lodha Developers Ltd., say they’re taking a hit on sales. Even an association with the U.S. president-elect hasn’t helped stoke sales at Lodha, which is building a Donald Trump-branded apartment tower in Mumbai’s Worli district. The 75-floor Trump Tower Mumbai includes a 24-hour resident manager and a fractional membership to a private jet service. The company has sold 226 of the 396 units in the project from its launch in 2014 through last June, said Lodha, which added that it limits the sale of its inventory at the Trump Tower.

Lodha said in an e-mailed response to Bloomberg News that while it has notched sales of more 3 billion rupees for all its properties since November’s demonetization, sales would have been higher without the policy change.

“No doubt that sentiment for real estate will be subdued over the next three to six months,” said Jijina at Piramal, citing the most pressure on luxury projects India-wide and in secondary cities such as Ahmedabad, Indore and Jaipur. Markets such as the region around the New Delhi area “where some developers took only cash will be in severe trouble,” he said.

India’s S&P BSE India Realty Index, comprising 10 property stocks, has dropped 8 percent since the cash ban on Nov. 8, compared with a 2.5 percent decline in the broader S&P BSE Sensex Index.

India withdrew 86 percent of the country’s banknotes in the nation’s biggest crackdown against corruption in almost four decades. Unaccounted-for money makes up as much as one-fifth of the Indian economy, according to Ambit Capital Pvt.

Demonetization of high-value currency notes may especially hurt luxury market and land transactions because the cash component ranges from 30 percent to 50 percent of the value of such deals, said Mumbai-based Pankaj Kapoor, founder of Liases Foras Real Estate Rating & Research Pvt.

“Land prices could drop as much as 25 percent once corruption is reduced and black money is out of the equation,” Kapoor said in an interview.
Riaz Haq said…
#India vehicle sales dropped 19% to lowest level since 2010 after #Modi's #Demonetization … via @bfly

What sort of auto market could be dealt the biggest blow in 16 years by a change in rules on banknotes? Ask Indian Prime Minister Narendra Modi.Vehicle sales in December slumped 19 percent from a year earlier to 1.2 million, their lowest level since 2010. If that sounds like an outsized impact for a class of consumer goods that are mostly not paid for upfront in Western countries -- let alone bought with hard currency -- you can take it as a salutary reminder that India's isn't like any other automotive market.The drop was overwhelmingly driven by vehicles that are so peripheral in developed markets, they're often forgotten -- motorbikes and mopeds.

In the U.S., the 501,000 two-wheelers sold in 2015 came to about 2.9 percent of total vehicle sales. Even in China, roughly three passenger cars are sold for every two motorcycles. In India, more than seven two-wheelers were sold or exported last year for every passenger car.So when investors think about the country's growth to become the world's third-biggest automotive market by 2020, it's worth reflecting that about 90 percent of the increase in unit sales over the past five years has come from bikes, scooters and mopeds -- an extra 5 million, compared with less than 200,000 for passenger cars.
Two for the Show
Motorcycles and mopeds have accounted for 90 percent of the growth in Indian automotive sales since 2011

Why should this distinction matter? The main reason is embedded in those December sales figures: Just as the wider spread of vehicle finance gives the European and U.S. automotive industries a different character to that in China, so the importance of two-wheelers gives the Indian industry unique qualities that are easily underestimated. This tripped up no less an industrialist than Ratan Tata, who created an expensive white elephant for Tata Motors Ltd. when he bet the country's middle class would trade in their two-wheelers for the low-cost Tata Nano car.The core sales demographic is (like India itself) less affluent, more rural, and has less access to the sort of finance products that make Western automotive markets as responsive to movements in interest rates as they are to shifts in selling prices.KEY SALES DEMOGRAPHICRural poorEmissions rules have some unusual quirks, too: While passenger cars are being brought into line with current European clean-air levels by 2020, mopeds and three-wheeled auto-rickshaws still commonly use the dirtiest two-stroke engines -- a situation that ought to be a risk factor for manufacturers if rules are ever homogenized.So if you're looking for bellwethers for the Indian industry, it could be worth paying a little less attention to Maruti Suzuki India Ltd. and Tata Motors and a little more to their smaller-cc cousins Hero MotoCorp Ltd. and Bajaj Auto Ltd. If you're impressed by Maruti's 18 percent year-on-year jump in sales volume in the September quarter, take a look at Eicher Motors Ltd., whose sales of Royal Enfield motorcycles were 42 percent higher in December than a year earlier.Even without two-wheeler sales, the country's rapidly growing auto market would be a force to be reckoned with. Meanwhile, though, it's a mistake to forget that in India, small is still beautiful.
Riaz Haq said…
#IMF revises #India GDP growth down to 6.6%. Says #India no longer fastest growing economy. #DeMonetisation #Modi

Canceling nearly 90% of cash in circulation cost India the mantle of world’s fastest-growing large economy in 2016, the International Monetary Fund said, though it categorized the slowdown as temporary.

India’s growth slowed to 6.6% last year from 7.6% in 2015, according to the fund’s latest World Economic Outlook, which estimates that China’s economy grew by 6.7% in 2016. The fund expects India’s expansion to bounce back to 7.2% this year and accelerate to 7.7% in 2018. China, meanwhile, is projected to continue decelerating, to 6.5% in 2017 and 6.0% the year after.

The IMF said it trimmed its 2016 forecast for India by one percentage point “primarily” because consumers tightened their purse-strings after November’s currency invalidation.

The fund’s sister institution, the World Bank, doesn’t think that was enough for India to lose the global growth crown, however. In the latest update to its global forecasts, released last week, the bank lowered its estimate of India’s 2016 growth to 7.0%—down from its earlier prediction of 7.6% but still ahead of China’s 6.7% growth.

None of these comparisons is exact. The IMF and World Bank both follow India’s practice of presenting output growth for the fiscal year, which ends March 31. China’s numbers—as with those of nearly every other large economy—are for the calendar year.

Still, the downgrades reflect deep uncertainty about India’s economic health since Nov. 8, when Prime Minister Narendra Modi stunned the country—and the world—by declaring all of the country’s high-denomination bank notes null and void for transactions. The move, aimed at flushing out stacks of cash amassed by businessmen and crooked bureaucrats, has driven families to cut back on spending, companies to let go of workers and investors to put projects on hold.

Earlier this month, India’s Central Statistics Office said it expected growth for the financial year to come in at 7.1%. But that projection was calculated using economic data only through last October, before the currency move was announced. More-recent data weren’t—and in some cases, still aren’t—available to statisticians.

Riaz Haq said…
#India set for slowest growth period as #Modi's #demonetization dents #economy. #Achhedin #BJP

India seems set for four consecutive quarters of sub-7 percent growth for the first time since at least 2011, as the government's demonetization drive triggers a shortage of cash, Societe Generale said.

The country's Central Statistics Office amended the way India counted its gross domestic product (GDP) numbers in January 2015, amending the base year to 2011-2012 from 2004-2005.

Under this new series, which dates back to June 2011, India experienced three consecutive quarters of growth below 7 percent between December 2012 and June 2013, according to Kunal Kumar Kundu, India economist at SocGen. If Kundu's forecasts turn out to be accurate, this would mark the first time growth will be below the 7 percent mark for four quarters in a row for the series.

A combination of crimped rural demand, falling capacity utilization and weakening business confidence could result in a far lower growth rate than India would be comfortable with, Kundu said in a note on Friday, starting with the quarter that ended Dec. 31.

SocGen slashed India's fiscal 2017 growth rate to 6.6 percent on-year from 7.3 percent previously. For fiscal 2018, which ends March 2019, the bank expects growth to be 7.2 percent on-year, down from an earlier projection of 7.7 percent.

"We also see the potential revival in already anemic private investment taking far longer than we originally anticipated," Kundu added.

More than 50 days have passed since India introduced its demonetization program in November, impacting 86 percent of India's currency in circulation. The government recalled existing 500 ($7.35) and 1,000 ($14.70) rupee notes and replaced with newly printed 500 and 2,000 rupee notes.

Initial data released in the aftermath showed the drastic slowdown in factory activity, in line with consensus.

Reuters reported the Nikkei/Markit Manufacturing Purchasing Managers' Index fell to 49.6 in December from November's 52.3, its first reading below the 50 level that separates expansion from contraction, since December 2015. Meanwhile, consumer prices rose at annual rate of 3.41 percent in December, their slowest pace since November 2014, said Reuters, and well below the Reserve Bank of India's 5 percent target by end of fiscal 2017.

Analysts reckon subdued consumer prices would leave the Reserve Bank of India with more room to cut rates. SocGen estimates two rate cuts of 25 basis points each for 2017.

SocGen also pointed to a study by the All India Manufacturers' Organization (AIMO), which showed micro and small scale industries suffered 35 percent job losses and a 50 percent decline in revenue in the first 34 days since the demonetization program. By March 2017, those numbers could be as high as 60 percent drop in employment and 55 percent fall in revenue, according to AIMO. These industries usually are very reliant on cash transactions.

The study pointed out factors that contributed to the impact included "zero cash inflow, rules curtailing cash withdrawals, staff absenteeism, a weaker rupee, (and) choked fundraising options," among others, Kundu said.

In his New Year's eve address, Indian Prime Minister Narendra Modi introduced various procedures aimed to cushion the blow from demonetization. They included special provisions for senior citizens, villagers, entrepreneurs and small businesses.

Riaz Haq said…
#India has been a post-truth society for years. #Modi #Trump #alternativefacts … via @_TCGlobal

India: home of post-truth politics

That was the global context of post-truth politics and its advent in the West. But as the US and UK wake up to this new era, it’s worth noting that the world’s largest democracy has been living in a post-truth world for years.

From education to health care and the economy, particularly its slavish obsession with GDP, India can be considered a world leader in post-truth politics.

India’s post-truth era cannot be traced to a single year – its complexities go back generations. But the election of Narendra Modi in 2014 can be marked as a significant inflection point. Ever since, the country has existed under majoritarian rule with widely reported discrimination against minorities.

India’s version of post-truth is different to its Western counterparts due to the country’s socioeconomic status; its per capita nominal income is less than 3% of that of the US (or 4% of that of the UK). Still, post-truth is everywhere in India.

It can be seen in our booming Wall Street but failing main streets, our teacher-less schools and our infrastructure-less villages. We have the ability to influence the world without enjoying good governance or a basic living conditions for so many at home.

Modi’s government has shown how key decisions can be completely divorced from the everyday lives of Indian citizens, but spun to seem like they have been made for their benefit. Nowhere is this more evident than with India’s latest demonetisation drive, which plunged the country into crisis, against the advice of its central bank, and hit poorest people the hardest.

Despite the levels of extreme poverty in India, when it comes to social development, the cult of growth dominates over the development agenda, a trend that Modi has exacerbated, but that started with past governments.

The dichotomy of India’s current post-truth experience was nicely summed up by Arun Shourie, an influential former minister from Modi’s own party. He disagrees with the prime minister, just as many Republicans share sharp differences of opinion with President Trump.

Shourie said the policies of the current administration were equal to his predecessors’ policies, plus a cow.

...there is an argument to be made that the US and the UK have been living in denial of facts and evidence for years. In 2003, after all, both the countries went to war in Iraq over the false notion that Saddam Hussein was harbouring weapons of mass destruction.
Major social change does not happen within the space of a year. Yet, to a large number of observers around the world, the “post-truth” phenomenon seemed to emerge from nowhere in 2016.

Two key events of 2016 shaped our understanding of the post-truth world: one was in June, when Britain voted in favour of leaving the European Union. The other was in November, when political maverick Donald Trump was elected the 45th President of the United States of America. Trump’s administration spent the third day of his presidency speaking of “alternative facts”, and making false claims about the size of the crowds that had attended his inauguration.

For the rest of the world, the importance of both Trump and Brexit can best be gauged by understanding that they happened in the USA and in the UK. The UK was the key driving force of the world from the 19th century until the second world war, the US has been ever since. The US and the UK often have shared a similar point of view on many global geopolitical developments, as strategic allies or by virtue of their “special relationship”.
Riaz Haq said…
Stratfor: Why #India will continue to misfire against #China and #Pakistan. #kashmir #NSG

discussion of India's ambitions must be measured against the reality of its constraints. India's fiscal limitations stymie investment into the infrastructure projects it needs to spur growth. It is weighed down by an unwieldy parliamentary system that struggles to channel the demands of its billion-citizen polity into coherent policies. And it must contend with the persistent security threat from archrival Pakistan, which has prompted it to commit resources to support a strong military presence in Indian-held Kashmir, in turn undercutting the integration of South Asia's economies.

India also suffers from demographic shortcomings that limit its economic development. About 70 percent of Indians live in rural areas, and up to a quarter of the population is impoverished. Prime Minister Narendra Modi's efforts to grow India's manufacturing base and employ more of its large pool of semiskilled labor remain hamstrung by the lack of land and labor reform in the country. Even if India could implement land and labor reforms, however, it would still struggle to develop a globally competitive manufacturing sector in this era of increasing automation. For India, then, a further embrace of multilateralism could give it a path not only to compensate for those shortcomings and earn the investments it needs to bolster the economy but also to help it place a check on Pakistan.

Even as Jaishankar alluded to the uncertainty that colors New Delhi's view of U.S. intentions under President-elect Donald Trump, he sees an opportunity as the new U.S. administration takes power for India to increase its international engagement as a way to overcome its limitations. Sensing that Washington will grow more reluctant to throw itself into the affairs of distant nations, India wants to fill the vacuum by assuming a greater global leadership role of its own.

Historically, Indian policymakers have generally honored the call by Jawaharlal Nehru, the country's first prime minister, to avoid entangling alliances. But the country has grown discontented with remaining aloof. In the past year alone, it has demonstrated the scope of its vision by engaging with every major region in the world. To wit, India hosted both the India-Association of Southeast Asian Nations summit and the BRICS summit and ratified the United Nations climate change protocol in Paris. Modi addressed a joint session of the U.S. Congress in June and embarked on a four-nation tour to Africa in July. He also hosted British Prime Minister Theresa May in what was her first visit outside of the European Union since taking office, and on Jan. 26, he will host Sheikh Mohammed bin Zayed al-Nuhayyan, Abu Dhabi's crown prince, as the chief guest for India's annual Republic Day parade..

Yet for all of its diplomatic fervor, India bickers over foreign policy with its northern neighbor, China. Despite protestations and support from Washington, India has been unable to persuade China to place Masood Azhar, the leader of the Pakistan-based militant group Jaish-e-Mohammad, on a U.N. blacklist. Similarly, an 11th-hour diplomatic pitch in June and support from Washington failed to earn India a vote needed from China that would have allowed it to join the Nuclear Suppliers Group, a 48-member body whose members share nuclear technology with one another. At the Raisina conference, Modi took a jab at China, saying that if Beijing wants its regional connectivity projects, including the China-Pakistan Economic Corridor, which runs through Kashmir, to be successful, it must respect India's sovereignty.


Riaz Haq said…
#Indian economy not in good shape: Ex PM Manmohan Singh. #India #BJP #Modi #Demonetization via @TOIBusiness

A day before presentation of Economic Survey, former Prime Minister Manmohan Singh on Monday painted a bleak picture of the Indian economy insisting "it is not in good shape" while former Finance Minister P Chidambaram said the government is "hiding behind" GDP numbers that are being challenged.
Releasing the "Real State of Economy 2017", a document prepared by the Congress research cell at the party headquarters here, Singh said it speaks about the state of India's economy, its many issues and where it is heading.
"That the Indian economy is not in a good state is obvious. Even IMF has downgraded our GDP growth and it will not be 7.6 per cent but less than 6.6 per cent," he said.

Chidambaram said the state of the economy "is not something that we can be happy about" and expressed concern over the low credit growth which he claimed is at 5 per cent, the "lowest in several decades".
"BJP is hiding behind a GDP number which is being challenged. People are not dazzled by it, but are asking where are the jobs? "NDA government tends to believe exaggerated version of economy, this research document is closer to truth than what government will say tomorrow," he said.
Chidambaram said every government must be optimistic, but optimism must stem from a realistic assessment of situation. "Yet, if government presents tomorrow a rosy picture of the economy, people of India are entitled to question that.
There are no jobs, capital formation is declining, credit growth is the lowest in several decades," he said. Chidambaram wanted government to focus on fiscal consolidation and said, "there are serious question marks on this government's ability to follow fiscal prudence".
He dismissed suggestions that the 2008 farm loan waiver was a populist measure, saying, "It was based on the response to a demand from the farming community and was a very wise decision."
"This was especially so as the international financial crisis hit in September 2008, which crippled even major economies but did not affect India much," he said.

He claimed that while there are no jobs, new capital investment and no credit growth, the document released "candidly, truthfully" assesses the state of India's economy, supported by hard research and data.
Hoping that government will not cut social sector spending, the former Finance Minister claimed that the MNREGS was the lone scheme that provided some succour to poor by way of jobs.

Riaz Haq said…
#India's factory output shrinks in December - . #Modi #Demonetization via @moneycontrolcom

India’s factory output contracted 0.4 percent in December amid signs of faltering industrial activity because of demonetisation. Factory output measured by the index of industrial production (IIP) is the closest approximation for measuring economic activity in the country’s business landscape. India’s factory output grew by a surprisingly robust 5.7 percent in November, running contrary to retail sales data showing slide in household spending and muted corporate investment hit by an economy-wide cash-crunch The opposition has been unsparing in its criticism about the government’s move to demonetise old Rs 500 and Rs 100 notes has forced many factories to cut down production, because of falling sales and low funds to pay wages in cash. Latest data shows that capital goods output, a metric to gauge capacity additions by companies, have contracted. It fell to -3 percent in December from 15 percent in November. The government has forecast that private final consumption expenditure (PFCE) during 2016-17 at constant 2011-12 prices—a scale to measure household spending—will be valued at Rs 67.13 lakh crore compared to last year’s Rs 63.01 lakh crore. Consumer spending as measured by PFCE will likely grow 6.54 percent in 2016-17 over last year, compared to 7.4 percent growth in 2015-16, signs that households have deferred spending to deal with the currency culling exercise. Electricity output was 6.3% in December, down from 8.9 percent in November. Mining sector output came in at 5.2 percent against 3.9 percent (MoM). Manufacturing sector output was at -2 percent against 5.5 percent (MoM).

Read more at:
Riaz Haq said…
Off balance: #India’s twin balance-sheet problem. Credit slump amid rising non-performing loans. … via @TheEconomist

IF INDIA is indeed the world’s fastest-growing big economy, as its government once again claimed this week, no one told its bankers and business leaders. In a nation of 1.3bn steadily growing at around 7% a year, the mood in corner offices ought to be jubilant. Instead, firms are busy cutting back investment as if mired in recession. Bank lending to industry, growth in which once reached 30% a year, is shrinking for the first time in over two decades (see chart). If this is world-beating growth, what might a slowdown look like?

India’s macroeconomy chugs along (though the quality of government statistics remains questionable), but its corporate sector is ailing. The sudden and chaotic “demonetisation” of 86% of bank notes in November hardly helped. But the origins of India’s troubles go much deeper. After India dodged the worst of the financial crisis a decade ago, a flurry of investment was made on over-optimistic assumptions. Banks have been in denial about the ability of some of their near-bankrupt borrowers to repay them. The result is that the balance-sheets of both banks and much of the corporate sector are in parlous states.

After years of burying their heads in the sand, India’s authorities now worry that its “twin balance-sheet” problem will soon imperil the wider economy. Both the Reserve Bank of India (RBI) and the government have nagged banks to deal with their festering bad loans. Around $191bn-worth, or 16.6% of the entire banking system, is now “non-performing”, according to economists at Yes Bank. That number is still swelling.

Given the linkages between them, companies and banks often run into trouble concurrently. But countries where banks’ balance-sheets resemble Swiss cheese usually have no choice but to deal with the issue promptly, lest a panicked public start queuing up at ATMs. India is different. State-owned lenders make up around 70% of the system, and nobody thinks the government will let them go bust. As a result, what for most economies would be an acute crisis is in India a chronic malaise.

That doesn’t make it any less painful. Investment is a key component of GDP, and it is now shrinking, thanks to parsimonious firms. India runs a trade deficit and the government is seeking to cut its budget shortfall, which leaves consumption as the sole engine of economic growth. Indeed, until demonetisation, consumer credit was booming, up by about 20% year on year. Some may wonder whether those are tomorrow’s bad loans, or when consumers will run out of stuff to buy.

Meanwhile, banks’ profits are sagging, even without the impact of fully accounting for dud loans. State-owned lenders collectively are making negative returns. Thirteen of them are described in a recent finance-ministry report as “severely stressed”. Demonetisation did indeed bring in lots of fresh deposits, but the bankers were then browbeaten into slashing the rates at which they lend, further denting their margins.

The dearth of investment is in part due to a lack of animal spirits. Sales outside the oil and metals sector are up by a mere 5% year on year, compared with nearer 25% at the start of the decade. Capacity utilisation, at 72.4%, is low by historical standards: even if money were available, it is not clear many would want to borrow.

Bankers, companies and policymakers once hoped the twin balance-sheet problem would eventually solve itself. Everyone’s incentive has been to look away and hope economic growth cures all ills. It has not: profits are in fact shrinking at the large borrowers, many of them in the infrastructure, mining, power and telecoms sectors. But banks have cut credit across the board, including to small businesses.

Riaz Haq said…
#Indian states on a borrowing binge are an unlikely competitor for #Modi and bonds. Rates rising. … via @business

Prime Minister Narendra Modi’s government is finding itself pitted against an unlikely competitor as it pursues bond investors to finance the budget deficit: Indian states.

With an ever-rising supply of debt that offers yields higher than sovereign notes, borrowing by state administrations threatens to overshadow that by the federal government, according to Edelweiss Asset Management Ltd. and HDFC Standard Life Insurance Co. That complicates matters for Modi, whose promise of fiscal discipline has lured foreigners to local bonds after a four-month hiatus.

Increased competition from states is also bad news for the sovereign-debt market, which saw benchmark notes in February post their biggest monthly loss since 2013, after policy makers in Asia’s third-largest economy signaled an end the monetary easing cycle. There is also a growing risk that, unless state deficits are pared, their debt levels could quickly get on to “an explosive path,” JPMorgan Chase & Co. said in a February report.

“There’s an increasing amount of concern over the states’ bond supply and the time when it will overtake government bond supply is not far away,” said Dhawal Dalal, chief investment officer for debt at Edelweiss Asset. “Concern about the health of the states is also something that worries market participants.”

Working together, India’s 29 states combined would form a bloc that has a bigger economy than the whole of sub-Saharan Africa, more members than the European Union, and twice the population of North America. Net borrowing by states will rise 12 percent to 3.8 trillion rupees ($58 billion) in the next financial year, after an estimated 30 percent-surge to 3.4 trillion in the fiscal year ending this March 31, according to ICRA Ltd. Modi plans to borrow a net 4.2 trillion rupees in the coming year.

“The disproportionate market focus on central finances masks the fact that India’s fiscal centre-of-gravity has rapidly moved from the center to the states,” Sajjid Chinoy and Toshi Jain, economists at JPMorgan Chase, wrote in the report. Borrowing by states is poised to overtake the centre’s by 2018-19, they said.


While higher yields and the implicit sovereign guarantee are a draw with investors, the securities are hardly a match for government bonds when it comes to liquidity. That’s partly why foreign investors, who were granted access to state debt in late 2015, have largely stayed away from the sector.

Investment by global funds stands at 14.8 billion rupees, data from the National Securities Depository Ltd. show. That’s just seven percent of the 210-billion rupee limit available to them.

“We buy state bonds only for portfolios where liquidity risk is not a concern, because the yield offered is close to top-rate corporate bond,” said Badrish Kulhalli, Mumbai-based fixed-income manager at HDFC Standard Life. “The extra supply of state bonds means the government bond yield curve will also steepen.”
Riaz Haq said…
#India and the Visible Hand of the Market. #Modi #Demonetization #Deflation #Onion #Potato #BlackMoney

Nearly eight months later (after demonetization), a lot of data is now available to help us assess what demonetization has actually wrought. Here it is, in a word: Demonetization failed to do what it was supposed to do, and although the immediate disruption it caused was less severe than feared at first, the policy’s impact is turning out to be more protracted than initially expected.

Very little black money has been caught. The truly corrupt hold their black money not as money at all, but as real estate and bank balances abroad. The government had authorized people to trade in up to 4,000 rupees in the canceled notes, so some parceled their 500- and 1,000-rupee bills into small bundles and got multiple agents (“money mules”) to change them, no questions asked. The government’s freshly minted 2,000-rupee notes promptly became the new stash currency of choice.

In the first weeks, even months, following demonetization, there was visible chaos. Soviet-era-style queues snaked in front of banks and A.T.M.s. The informal sector — mostly small traders, farmers and small unregistered businesses, which often don’t have bank accounts — reeled from cash shortages. But the immediate damage caused, though large, was not as large as some of us had feared. G.D.P. growth in the last quarter of 2016 was 7 percent and manufacturing activity continued to grow.

On the other hand, there may be greater long-term side effects than expected.
The problems appeared unexpectedly, when agricultural products arrived on the market. In January, with cash shortages in full swing, demand plunged and food prices collapsed. By February, potato prices in Uttar Pradesh were just over half of what they had been during most of 2016 (at around 350 rupees per quintal, instead of over 600 rupees per quintal). Tomato prices were less than one-third. Onion prices in May were half of what they had been a year before. The cost of onions in India is notoriously volatile — and often influenced by politics and elections — but the likeliest culprit for this year’s drop was demonetization.


An economy is a complex machine, and there is no way to be absolutely certain that the cause of all this is demonetization. But there is a telltale sign: Much of the slowdown originated in the financial sector. Rural loans increased by only 2.5 percent between October 2016 and April 2017, compared with 12.9 percent a year before. The rate of growth in overall bank credit declined.

The growth in industrial output in April was a paltry 3.1 percent, down from 6.5 percent the previous April. In the first quarter of 2017, the construction sector actually shrank, by 3.7 percent, over the previous quarter.

All this augurs poorly for the months to come: As the agriculture sector slows down in response to low crop prices and the credit shortage begins to bite, overall growth will likely fall further. The state-engineered shock of demonetization will continue to course through the economy.

Demonetization did boost the use of digital money, which is more efficient than paper money. But the government didn’t need to put 86 percent of the currency out of circulation to achieve that. Demonetization was too coarse an approach, and it accomplished too little while causing too much collateral damage.
Riaz Haq said…
S SEPE 0 1 1994.
A thesis presented to the Faculty of the U.S. Army
Command and General Staff College in partial
fulfillment of the requirements for the
M.Sc., Defence Studies, Madras University, 1988

Fort Leavenworth, Kansas

India's neighbors compel
them to view India as being a common foe. Pakistan which is
the only country in the region which can, to some extent,
challenge Indian hegemony, has greatly benefitted by such
perceptions of other countries. Due to the Kashmir issue,
Pakistan has viewed India as an enemy country right from the
time of partition in 1947 when they fought their first war
over Kashmir. Pakistan's claim to Kashmir is based on the
religion. Islam, a rallying point for separate statehood
for Indian Muslims during the British days, continues to be
the essential element of Pakistan's foreign policy
formulation. Therefore, the fear of militarily and
industrially powerful India representing potential Hindu
domination has remained the essence of Pakistan's South
Asian outlook. Consequently, the defence policy of Pakistan
has revolved around the central theme of containing Indian
attempts to achieve regional hegemony


No Hegemon Anymore
The unified South Asian nation would also put an end
to the present problem of India trying to acquire the status
of a hegemon among the other smaller South Asian countries.
The problem of Indian hegemony is such that it can not be
resolved easily under the present political division of
South Asia. Presently, to end this problem, it requires,
that either India become extremely strong compared to her
neighbors, so that they start acknowledging India's hegemon
status or some other state, most probably, Pakistan becoming
equally strong as India. However, there is not even a
remote possibility of either of the above occurring in a
foreseeable future. Compared to its neighbors, India's
elements of national power are much greater and it would be
extremely difficult for Pakistan to acquire status equal to
that of India.
On the other hand, despite her strong elements of
national power, India is still ridden with too many problems
to achieve an absolute hegemony in the region. In any case
such an absolute hegemony may be impossible to achieve
because of the international politics such as aid to
Pakistan from the Islamic countries, China or the USA. In
an unified South Asian nation, the people would be able to
identify themselves with the nation, more intensely, due to
its strength and size. There would not be any compulsions,
like the present, for the smaller nations to gang up to
counter the hegemonic tendencies of the big neighbor, India,
as there would be just one unified nation, of which they and
India would be parts of
Riaz Haq said…

India’s GDP Mis-estimation: Likelihood,
Magnitudes, Mechanisms, and Implications
Arvind Subramanian ( former Chief Economic Adviser to the Government of India)
CID Faculty Working Paper No. 354
June 2019

The main findings of this paper are the following. First, a variety of evidence—within India and
across countries—suggests that India’s GDP growth has been over-stated by about 2 ½ percentage
points per year in the post-2011 period, with a 95 percent confidence band of 1 percentage point.
That is, instead of the reported average growth of 6.9 percent between 2011 and 2016, actual growth
was more likely to have been between 3 ½ and 5 ½ percent. Cumulatively, over five years, the level
of GDP might have been overstated by about 9-21 percent.


India changed its data sources and methodology for estimating real gross domestic product (GDP) for
the period since 2011-12. This paper shows that this change has led to a significant overestimation of
growth. Official estimates place annual average GDP growth between 2011-12 and 2016-17 at
about 7 percent. We estimate that actual growth may have been about 4½ percent with a 95 percent
confidence interval of 3 ½ -5 ½ percent. The evidence, based on disaggregated data from India and
cross-sectional/panel regressions, is robust. Lending further credence to the evidence, part of the overestimation can be related to a key methodological change, which affected the measurement of the formal
manufacturing sector. These findings alter our understanding of India’s growth performance after the
Global Financial Crisis, from spectacular to solid. Two important policy implications follow: the
entire national income accounts estimation should be revisited, harnessing new opportunities created by
the Goods and Services Tax to significantly improve it; and restoring growth should be the urgent
priority for the new government.
Riaz Haq said…
#India #currency in circulation up 9.9% to over ₹31 lakh crore in FY22. Share of ₹500 and ₹2,000 notes together rose to 87.1% of total value of banknotes in circulation, despite #Modi's #DigitalIndia and #fintech. #Demonetization #BJP

The value and volume of banknotes in circulation increased by 9.9% and 5%, respectively, at ₹31,05,721 crore and 13.05 lakh, respectively, the Reserve Bank of India's annual report for 2021-22 shows. Comparatively, the increase in currency in circulation (both value and volume terms) was 16.8% and 7.2%, respectively, during 2020-21.

The rise in banknotes in circulation, despite the government's push for digital India and various reforms in the banking and fintech industry, has been attributed to "the second wave of COVID-19 pandemic, which induced renewed restrictions on movement in various parts of the country”.

The RBI supplies banknotes in denominations of ₹2, ₹5, ₹10, ₹20, ₹50, ₹100, ₹200, ₹500 and ₹2,000, while coins comprise 50 paise and ₹1, ₹2, ₹5, ₹10 and ₹20 denominations.The share of ₹500 banknotes, both in value and volume, increased during 2021-22 as compared to the previous year. However, the ₹2,000 banknote share continued to dip in both value and volume.In value terms, the share of these banknotes together accounted for 87.1% of the total value of banknotes in circulation as of March 31, 2022, against 85.7% on March 31, 2021.In volume terms, ₹500 notes constituted the highest share at 34.9%, followed by ₹10 denomination at 21.3% of the total currency in circulation as of March 31, 2022.The total value of coins in circulation rose 4.1% to ₹27,970 crore in 2021-22, while its volume grew 1.3% to 12,46,298.As of March 31, 2022, the coins of ₹1, ₹2 and ₹5 together constituted 83.5% of the total volume of coins in circulation, while in value terms, these denominations accounted for 75.8%.The currency issuance (both banknotes and coins) and its management are performed by the RBI through its issue offices, currency chests and small coin depots spread across the country.As of March 31, 2022, the State Bank of India accounted for the highest share of 53.6% in the currency chests network. The indent of banknotes was lower by 1.8% in 2021-22 than that of a year ago. The supply of banknotes was also marginally lower by 0.4% during the said year than the previous year.During 2021-22, the indent and supply of coins saw a huge drop at 73.3% and 73%, respectively, from the previous year.The RBI data shows that the year 2021-22 saw an 88.4% rise in the disposal of soiled banknotes as compared to the previous year at 1,878.01 crore pieces vs 997.02 crore pieces during the previous year.During the fiscal year 2021-22, of the total fake currency notes detected in the banking sector, 6.9% were detected at the RBI and 93.1% by other banks.Compared to the previous year, there was an increase of 16.4 per cent, 16.5 per cent, 11.7 per cent, 101.9 per cent and 54.6 per cent in the counterfeit notes detected in the denominations of ₹10, ₹20, ₹200, ₹500 (new design) and ₹2,000, respectively.Overall, the RBI spent ₹4,984.8 crore on security printing from April 1, 2021, to March 31, 2022, against ₹4,012.1 crore in the previous year (July 1, 2020, to March 31, 2021).
Riaz Haq said…
India's Economic Situation 'Bleak'; We Know the Issue but Not the Solution: Pronab Sen
In an interview with Karan Thapar, the country's former chief statistician said that India will miss the RBI's target of 7.2% growth for this financial year and that it'll come around 6-6.5%. (real growth going forward will be around 4%)

Pranab Sen: Demonetization and COVID lockdown dried up the informal credit and killed a large percentage of small and medium enterprises.

In an interview where he paints a bleak and disturbing picture of the state of the economy, India’s former chief statistician professor Pronab Sen has said that we can identify the problems that are retarding growth but we don’t know how to tackle them.

Worse, professor Sen says he is not sure if the government has diagnosed the problems because it has not spoken about them and its silence can be variously interpreted. Consequently, he says that India will miss the RBI’s target of 7.2% growth for this financial year and that it will growth will only come in somewhere around 6-6.5%.

However, he points out, in real terms growth will actually be just 4% which, he adds, is at least 2.5% below the growth India needs to create jobs for its population. This means, professor Sen points out, we can boast of being the fastest growing economy but it’s equally true that we are considerably falling short of the rate of growth we need (6.57%) to create sufficient jobs for our people which, in turn, will boost consumption and spending and create incentives for investment.

In these circumstances, professor Sen said that first quarter growth of FY23 at 13.5% is clearly disappointing.

In a 42-minute interview to Karan Thapar for The Wire, professor Sen, who is currently the country director of the International Growth Centre, identified two critical areas where the Indian economy faces serious problems about which we are not sure what we should do.

The first is the MSME sector which, he added, has undoubtedly shrunk in size over the last two years. The problem is not a question of encouraging and helping existing MSMEs so much as creating the environment for new MSMEs to emerge. The specific problem is that the informal credit line on which they depend has dried up and we don’t know how to revive that credit line. The government does not have a clear way of doing so.

And, the problem afflicting MSMEs, professor Sen says, is the reason why manufacturing has only grown year-on-year by 4.8% and why joblessness and unemployment are an increasing concern. Most jobs are created by MSMEs or the wider unorganised sector and that seems to have stopped or, at least, is not happening in sufficient measure.

The second problem professor Sen identified is the critical services sector of trade, hotel, transport, communication and broadcasting services, which represent 30.5% of employment but is still 15.5% below pre-pandemic levels. Once again, he said we don’t know what we need to do to boost this sector back to pre-pandemic levels. He pointed out that many MSMEs work in this sector and its future is, therefore, directly linked to MSMEs.

Professor Sen also pointed out that the global situation will not be of much help to India. Interest rates are likely to remain high and exports, which have been a support to the economy until recently, will face problems in markets like Europe and America and, therefore, fail to provide the boost to growth they have previously given. However, he believes oil prices could come down.

He believes India is clearly locked into a K-shaped recovery and the arms of the K are moving further and further apart.

Whilst scoffing at commentators and newspapers that have called for broad-based reforms, without identifying what they would be, professor Sen said that the key reform needed would be credit lines that would service MSMEs and provide funds for new MSMEs to start up.
Riaz Haq said…
'India needs educated PM': Arvind Kejriwal targets Narendra Modi in Assam | Deccan Herald

Continuing his criticism of Prime Minister Narendra Modi over his educational qualifications, Delhi CM Arvind Kejriwal on Sunday said an educated PM would not have gone for "dangerous" decisions like the demonetisation and three "anti-farmer" laws.

"I listened to Narendra Modi's speech where he said he went to a village school only and could not do further studies. But I want to ask you today, shouldn't the Prime Minister of a great nation like India be educated?" Kejriwal asked the crowd during his maiden rally in Assam capital Guwahati on Sunday afternoon. The rally was organised by the Assam unit of Aam Aadmi Party (AAP) as part of its organisational expansion programme in the state, where BJP has been in power since 2016.

"India is a poor nation and someone not going to school due to poverty is not a crime. But our Prime Minister should be educated. The Prime Minister did demonetisation which took our economy 10 years backward. Someone fooled our PM and told him to ban the notes to end corruption. Did demonetisation end corruption? Someone told our PM that demonetisation will end terrorism. Did demonetisation end terrorism?" Kejriwal asked.

"It's the 21st Century and youths of the 21st Century are aspirational. They believe in science and technology. They want employment and prosperity of India and only an educated PM can bring that prosperity. A less educated or illiterate person can not bring prosperity. A private company asks for an MBA, MA and BA degree for a manager's job. But shouldn't there be educational qualifications for the country's topmost manager as the Prime Minister?" he asked.

Punjab CM Bhagwant Singh Mann addressed the rally before Kejriwal in which he also slammed BJP.

Both Kejriwal and Mann slammed their Assam counterpart Himanta Biswa Sarma saying the latter was only doing "dirty politics" and failed to provide jobs, hold examinations in a fair manner and could not improve amenities such as schools, hospitals and other infrastructure. "Today he is threatening me on TV to put me behind bars. Am I a terrorism, why will you catch me?" Kejriwal asked while referring to Sarma's warning on Friday about filing defamation cases in case the former made corruption allegations. "Today I want to invite him to come to my home for tea when he visits Delhi next. I will take him around in my car and the finest schools and hospitals we have provided to the people of Delhi," he said. Both Mann and Kejriwal asked why Sarma's wife was running a private school in Guwahati. "If a CM's wife runs a private school, will the government improve the government schools?" he asked. Both promised that AAP will provide Delhi and Punjab-like facilities if people voted them to power in the Assembly elections in 2026.
Riaz Haq said…
India’s #Modi's Wild Vanity Project Already Has Eight Dead #Cheetahs. #Indian prime minister’s PR attempt to reintroduce big cats to #India was doomed from the start, scientists and conservationists say. #BJP #Hindutva

Twenty cheetahs were shipped to India from Southern Africa in a historic intercontinental translocation designed to restore the big cats to the country for the first time in 70 years.

The first delivery was timed to coincide with the Indian prime minister’s birthday last year. Amid huge fanfare leading up to the big day, enormous billboards across major cities in the country advertised this achievement of Narendra Modi and his ruling Bharatiya Janata Party.

Cheetahs—the agile big cats known for their remarkable speed and striking appearance—were declared extinct in India in 1952. Now Modi—the most powerful Indian leader in decades—seemed to be saying he could turn back time and bring these beautiful creatures home to a resurgent India.

The results, so far, of this grandiose plan have been tragic.

The first eight cheetahs arrived from Namibia last September, and another 12 cheetahs from South Africa were introduced to the Kuno National Park—located in the central Indian state of Madhya Pradesh—in February this year.

Hopes across the country were sky high, but even before they arrived, scientists and conservationists were raising major concerns about this unprecedented plan.

Kuno National Park emerged as the location for the reintroduction of cheetahs, beating out 10 surveyed sites in five central Indian states, according to the government’s action plan. Studies by conservation researchers, however, disagreed.

The action plan, devised by the Wildlife Institute of India, says that this decision was influenced by Kuno National Park’s “suitable habitat and abundant prey base.” Scientists, again, disagree.

While the ambitious plan to reintroduce cheetahs was being put into action, there were murmurs of concern among India’s wildlife community. They said the plan was “ecologically unsound” besides being costly and “may serve as a distraction rather than help global cheetah conservation efforts.”

Modi ignored their fears. In 2012, the Supreme Court of India had already intervened by putting a stay on the government’s plans to import cheetahs, and in 2013, the apex court reaffirmed its position, emphasizing the necessity for the government to present a comprehensive study before any consideration could be given to introducing cheetahs from Africa.

In 2017, the National Tiger Conservation Authority in India made an appeal to the apex court to reconsider its decision. Following the appeal, the Supreme Court granted permission in 2020 to introduce the cheetah on an “experimental basis.”

Many raised objections.

‘Flawed from the start’
As time passed, the fears of the wildlife community began to materialize as one by one, the big cats started losing their lives. Since March this year, a total of eight—including three cubs born to a Namibian cheetah named Jwala—have lost their lives at the park, adding to the growing toll of cheetah deaths.

Many argued the grand project—which cost $6 million so far—is on the brink of failure.

Dr. Arjun M. Gopalaswamy, a renowned big cat scientist in India told The Daily Beast: “The project was already flawed but now these unforeseen deaths, inexplicable deaths have made it far worse than what we thought.” He says the project is now at a “salvage point.”

India, despite the mounting demographic pressure, has lost only one large wild species of mammals since its independence from the British in 1947—the cheetah. And hence its reintroduction “has a very special significance for the national conservation ethic and ethos.” The Indian government believes that bringing back the cheetah will have “equally important conservation ramifications.”

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